Although store closings and dead malls are nothing new, according to Credit Suisse, things are about to get a whole lot worse. A new report out this week from the bank states that between 20% and 25% of American malls will close within five years. That kind of plunge would be unprecedented in the nation’s history.1
In 1970 there were 300 enclosed malls in the U.S. and now there are 1,211 of them. In fact, even though the retail industry has experienced serious change in the last couple of years, the number of malls open has gone up every year. But, if the analysts at Credit Suisse are right things are about to turn sharply in the other direction.
But it’s not just department stores; this week, Michael Kors announced plans to close 100 to 125 stores.
“Traditional mall anchors, such as Macy’s, J.C. Penney and Sears, have announced numerous store closings in recent months. Clothiers including American Apparel and BCBG Max Azria have filed for bankruptcy. Bebe has closed all of its stores. The report estimates that around 8,640 stores will close by the end of the year.” 3
Not everyone is convinced about the Credit Suisse numbers though. Only time will tell.
While the mall has historically been a social gathering place, the competition that exists today didn’t exist in the past. Things are going to continue to change, and change in a part of life, but for those who live in small towns, you might soon need to shop online or make a weekly/monthly/annual trip to a larger city if you still want the mall experience.
